27 Mar, 2024

Global Crypto Funds Saw Record Net Outflows of Nearly $1 Billion Last Week

Quick Take① Crypto investment products witnessed record outflows last week, with $942 million exiting funds globally, according to CoinShares.② This represents the first weekly net outflows witnessed following a seven-week streak of inflows totaling $12.3 billion.Crypto funds at asset managers such as BlackRock, Bitwise, Fidelity, Grayscale, ProShares and 21Shares registered record outflows totaling $942 million globally last week, according to CoinShares’ latest report.Last week’s outflows nearly doubled the prior record of $500 million set toward the end of January and follow a seven-week inflow streak totaling $12.3 billion — including the $2.9 billion of record inflows witnessed during the week before last.Trading volume for crypto investment products dropped a third to $28 billion for the week while the price correction in the underlying cryptocurrencies saw $10 billion wiped off the funds’ assets under management. The combined AUM remains above prior cycle highs at $88 billion.Newborn spot Bitcoin ETFs not enough to offset Grayscale outflowsOver $1 billion worth of inflows into the newborn spot Bitcoin exchange-traded funds in the U.S. were not enough to overcome nearly $2 billion in outflows from Grayscale’s converted GBTC fund.“We believe the recent price correction led to hesitancy from investors, leading to much lower inflows into new ETF issuers in the U.S., which saw $1.1 billion inflows, partially offsetting incumbent Grayscale’s significant $2 billion outflows last week,” CoinShares Head of Research James Butterfill wrote.Given the dominance of the U.S. spot Bitcoin ETFs, those funds unsurprisingly led the flows, contributing $904 million, or 96%, of the net outflows last week. Meanwhile, short-bitcoin investment products saw minor outflows of $3.7 million.Poor sentiment not just focused toward US or BitcoinPoor sentiment last week was not just focused toward the U.S.-based funds or bitcoin in general. Crypto investment products based in Sweden, Hong Kong, Switzerland and Germany also witnessed outflows of $37 million, $35 million, $25 million and $4 million, respectively. Although, Brazil and Canada-based funds bucked the trend with inflows totaling $9 million and $8.4 million.Ethereum, Solana and Cardano-based investment products also suffered, generating outflows of $34 million, $5.6 million and $3.7 million, respectively. However, the rest of the altcoin-related funds fared better, registering net inflows of $16 million, including Polkadot ($5 million), Avalanche ($2.9 million) and Litecoin ($2 million).

22 Mar, 2024

Apple's Antitrust Lawsuit Signals Change for Crypto Apps

In a pivotal turn of events, the U.S. Justice Department is reportedly on the verge of filing an antitrust lawsuit against Apple, signaling a potential shake-up in the tech giant's business practices and opening avenues for enhanced competition within the “third party” crypto app ecosystem.This impending legal action, which has been years in the making, holds significant promise for third-party crypto apps, offering a potential reprieve from Apple's alleged anti-competitive measures and fostering an environment conducive to innovation and market expansion.Addressing Apple's Alleged Anti-competitive PracticesThe lawsuit is expected to challenge Apple's restrictive app store terms, high fees, and its tightly controlled hardware and software integration, a move that could pave the way for greater accessibility and functionality for crypto-based applications.At the core of the legal battle are Apple's strict policies, including its substantial 30% commission on most app store sales and limitations on third-party access to specific hardware features. These practices have long been a point of contention for app developers, particularly those in the crypto space, who have faced hurdles in delivering full-fledged experiences to iOS users.Potential Opportunities for Growth and InnovationBy challenging Apple's dominance and pushing for more equitable terms, the lawsuit has the potential to level the playing field for third-party crypto apps, enabling them to innovate and compete on a fairer footing. This could lead to the development of more robust and feature-rich applications, catering to the growing demand for crypto-related services and products.Moreover, the legal action against Apple aligns with broader governmental efforts to promote competition and consumer choice in the digital economy, underscoring the importance of fostering an environment that encourages innovation and entrepreneurship.In response to the news of the impending lawsuit, Apple Inc. saw a dip in its stock value, reflecting investor concerns about the potential implications of legal action on the company's bottom line. However, for third-party developers operating in the crypto space, the prospect of a more open and competitive app ecosystem represents a significant opportunity for growth and expansion.Regulatory Uncertainties and Market DynamicsWith Apple's alleged anti-competitive practices under scrutiny, developers of crypto apps may find themselves with greater flexibility and autonomy to deliver innovative solutions to users. This could lead to an influx of new and improved crypto applications, offering enhanced features, functionality, and user experiences.Future Outlook and Market EvolutionFurthermore, the legal action against Apple may prompt other tech giants to reassess their own app store policies, leading to a ripple effect across the industry. As competition heats up, consumers stand to benefit from a broader range of choices and more innovative offerings in the crypto app space.The delay in the SEC's decision on a proposed spot Ethereum exchange-traded fund (ETF) underscores the regulatory uncertainties surrounding cryptocurrency investment vehicles. However, a more competitive app ecosystem resulting from the Apple lawsuit could create new opportunities for crypto ETFs and other investment products, driving further growth and adoption in the crypto market.We in the Web3 space hope this antitrust lawsuit against Apple has the potential for positive change within the third-party crypto app ecosystem, fostering innovation, competition, and consumer choice. As regulatory and legal proceedings unfold, developers and users alike can look forward to a more vibrant and dynamic landscape, with greater opportunities for growth and innovation in the crypto space.